AMBASSADOR'S CALL ON PRESIDENTIAL FOREIGN AFFAIRS

C O N F I D E N T I A L SECTION 01 OF 02 BRASILIA 002428 SIPDIS E.O. 12958: DECL: 09/22/2014 TAGS: PREL PGOV PARM BR US SUBJECT: AMBASSADOR'S CALL ON PRESIDENTIAL FOREIGN AFFAIRS ADVISOR MARCO AURELIO GARCIA, 17 SEPTEMBER 2004 Classified By: AMBASSADOR JOHN J. DANILOVICH. REASONS: 1.4 (B)(D). (C) 1. In a friendly and animated initial courtesy call by Ambassador on 17 September, President Lula da Silva's Senior Advisor on International Affairs, Marco Aurelio Garcia, reviewed a range of bilateral and international issues. Garcia observed that the bilateral relationship is positive and sound, characterized by efforts on both sides at "mutual understanding" and bolstered by the personal rapport between Presidents Bush and Lula. Other high points of the discussion follow: REGIONAL ISSUES ¶2. (C) Garcia affirmed his own role in stressing to Lula the centrality of South America to Brazil's foreign policy agenda. Specifically, Garcia said GOB priorities in South America have included reinforcing Mercosul (which Garcia claimed had languished under the previous administration), building economic and political stability on the continent (Brazil's prominent presence in crisis management in Venezuela and Bolivia are examples of this effort),and strengthening relations with Chile. Garcia further said that the GOB strategic toolbox for regional stabilization includes use of BNDES development bank funding for infrastructure projects, import substitution programs to increase Brazilian purchases from neighboring countries, and expansion of the investment presence in the region of major Brazilian industries, notably Petrobras. ¶3. (C) The Ambassador asked for a readout of Lula's recent meeting in Manaus with Venezuelan President Chavez, and for Garcia's thoughts on the way forward in Venezuela in the wake of the referendum. Garcia limited his response to the Manaus meeting, noting that its central importance was in refocusing attention on cooperation in the Amazon region, with new emphasis on the Amazon Treaty Organization, which is being re-energized and headquartered in Brasilia. NONPROLIFERATION ¶4. (C) Ambassador raised the question of Brazilian adherence to the IAEA Additional Protocol. He said that he believes the dialogue on nuclear issues between the GOB and IAEA will become "calmer" ("mais tranquilo") in coming months. Garcia observed that Brazil's constitution of 1988 expressly prohibits national development of nuclear weapons; that Brazil's nuclear program is "totally transparent"; and that Brazil's regional and international non-proliferation credentials are strong (Garcia cited the success of the Brazil-Argentina ABACC mechanism for nuclear monitoring and confidence measures). ¶5. (C) For those reasons, Garcia said the GOB believes Brazil deserves patience as it works through its concerns toward possible AP adherence, and he regretted media commentary that sometimes casts Brazil in the same suspicious company as Iran and North Korea. Ambassador replied that no serious analyst would place Brazil in such a suspect category, but given the continued intense concern about nuclear security, Brazil's hesitation on the AP question fuels conspiratorial speculation among uninformed commentators. BRAZIL'S DEVELOPMENT ¶6. (SBU) In conclusion Garcia opined that Brazil continues to face several fundamental challenges on its road to real development. These include: (1) stimulating substantial and lasting growth of the economy; (2) encouraging much fairer distribution of income; (3) diminishing Brazil's vulnerability to external economic shocks; (4) achieving lasting macroeconomic stability, and (5) continuing to expand and institutionalize democracy. Garcia opined that managing all the challenges effectively will require decades of competent and energetic governance. ¶7. (C) Comment: Garcia seemed to enjoy our conversation and expressed interest in further contact. He was expansive and thoughtful, his academic pedigree from years of teaching and study in Brazilian and European universities much in evidence. While Garcia's intellectual influence on Lula's foreign policy likely remains strong, speculation earlier in Lula's administration that Garcia would dominate foreign policy -- even edging out FM Amorim -- does not appear to us borne out by events. While Garcia accompanies Lula on most foreign trips, drafts the president's international speeches and has undertaken sensitive missions to Bolivia and Venezuela, it is not at all apparent that his positions on policy are decisive. Nonetheless, we intend to maintain this channel to"the professor" (as he prefers to be called); his access to and influence over a president who has also been Garcia's close friend for decades make such engagement uniquely useful. Danilovich